# Quiz 66: Cost Volume Profit Analysis

Test your knowledge of double entry bookkeeping with our cost volume profit analysis quiz.

Cost volume profit analysis shows the effect of changes in costs and volume on the profit of a business. It is used as a management tool to make decisions about matters such as selling prices, break even sales levels and best use of production facilities.

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If you need a refresher course on the use of cost volume profit analysis, take a look at our tutorial on the CVP income statement, break even analysis and our costing tutorials.

## Start the Cost Volume Profit Quiz

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1. A product has a selling price of 225 and variable costs of 90. What is the products contribution margin?
2. A product has a selling price of 120 and variable costs of 48. What is the products contribution margin ratio?
3. A business reduces its sales volume from 1,000 units to 850 units. Its product has a 15 contribution margin, what is the change in the total contribution margin ?
4. A business has fixed costs of 9,000 for the period. Assuming its product has a selling price of 15 and a contribution margin ratio of 60%, what is the number of units required to break even.?
5. Assuming all other items remain constant, what happens to the break even point when the unit sales price increases?
6. Assuming all other items remain constant, what happens to the break even point when the unit cost increases?
7. Assuming all other items remain constant, what happens to the break even point when the fixed costs decrease?
8. A product has a unit selling price of 300 and unit variable cost of 120. If the business needs to sell 50 units to break even what are the total fixed costs?
9. A business sells a product which costs 50 for 125. The sales (value) of the business for the period increases by 750, what was the increase in the number of units sold?
10. A business increases sales volume by 150 units which results in an increase in sale value of 18,000. If the selling price of its product is 200 what is the unit cost price?

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